The dust has settled at Stillwater Mining (SWC) with the election of four new board members backed by the Clinton Group, an activist investor that wants the company to focus on the profitability of its U.S. platinum and palladium mines and cut back or end plans to expand into copper mining after a 2011 acquisition of copper reserves in Argentina.

That removes a major distraction hanging over the company’ stock and should leave the shares free to reflect Stillwater’s unique position as the only U.S. producer of platinum and palladium at a time when mines in South Africa are cutting production due to strikes. (Stillwater Mining is a member of my Jubak’s Picks portfolio http://jubakpicks.com/ )

Palladium and platinum are two of the very few commodities that remain in a supply deficit in 2013 and that are likely, Barclays projects, to remain in deficit in 2014. Because of strikes in South Africa, global platinum production fell 10% in 2013 and palladium production fell 11%.

And unlike gold, where a bare 10% of consumption goes for industrial production, 60% of platinum consumption and 91% of palladium consumption goes to industrial production. That’s been especially good for palladium as demand rose 16% to a record 9.9 million ounces in 2013 as the global auto industry continued a recovery. (At least outside of Europe.) Palladium and platinum are key ingredients in automobile catalytic converters.

You can see the platinum/palladium story very quickly by comparing the performance of ETFs for those metals with that of a gold ETF. While a gold ETF such as the SPDR Gold Shares (GLD) is down 16.6% year to date and down 12.57% over the last year, the ETFS Physical Palladium Shares (PALL) is up 6.23% year to date and up 23.46% over the last year. The ETFS Physical Platinum Shares (PPLT) is down 3.28% year to date but up 2.08% over the last year.

Shares of Stillwater Mining are up 63.9% over the last year, but have climbed just 1.7% in 2013 to date.

For the company’s first quarter, reported on April 29, the company announced production of 127,100 ounces of palladium and platinum, a 5.2% increase from the first quarter of 2012. Realized prices for palladium rose to $725 an ounce in the quarter from $671 in the first quarter of 2012 and for platinum to $1628 an ounce from $1598 in the first quarter of 2012.

One of the things that I especially like about Stillwater is that its production is very heavily slanted toward palladium, my preference between these two metals in 2013. Of the company’s first quarter production 98,000 ounces were palladium and 29,000 were platinum.

As of May 21, 2013, I calculate a target price of $18 a share, a slight tweak upward from my previous target of $17 a share. That’s 39.8% above the price of $12.87 at noon on May 21.

Full disclosure: I don’t own shares of any of the companies mentioned in this post in my personal portfolio. When in 2010 I started the mutual fund I manage, Jubak Global Equity Fund http://jubakfund.com/ , I liquidated all my individual stock holdings and put the money into the fund. The fund did not own shares of Stillwater Mining as of the end of March. For a full list of the stocks in the fund as of the end of March see the fund’s portfolio at http://jubakfund.com/about-the-fund/holdings/